Posted on: February 13, 2015
Earning positive cash flow from real estate investments isn’t exactly easy. You need to give yourself, your tenants, and your property a little TLC if you want to cash in the big bucks. We’ve put together some tried and tested tips to help you maximize your earning potential.
Business Love: Set Yourself Up For Success
The basics of real estate investing matter, both in residential and commercial property investment. Whether it’s your first property or you’re a seasoned investor, you should always treat your property investments as a business. This means making sure you have priced the rents accordingly for your area, the property value, and usage. It also means finding good quality tenants you can rely on. Don’t be tempted to set low rents in order to fill your property quickly. This often attracts less reliable tenants who are searching for properties based heavily on price-point. Be selective about your tenants and always do complete background checks.
Client Love: Tenants Are Customers
Doing small things to improve your relations with your tenants goes a long way for keeping them happy. Satisfied tenants can help with tenant retention, which ultimately means less hassle for you. Good relations can also create connections to help you fill future properties. Small gestures like a gift when signing a lease, holiday cards, or a thoughtful present during ongoing renovations are inexpensive ways to satisfy your customers. By vetting the right tenants you can ensure that your well-intentioned affections aren’t wasted.
Love Your Pocket: Watch Your Expenses
When you take on a new property, and periodically afterwards, you should look at ways to reduce long-term costs. Reviewing associated property costs can save money and increase the cash flow of that property. These include looking at the cleaning and maintenance services the property uses at time of purchase and shopping around for better deals that provide ample services. Maybe there’s a cheaper air duct maintenance firm or cleaning service. If there is one, you should know about it.
Property TLC: Improvements That Save Money
A great way to improve your property and create larger annual profits is to minimize energy costs. Though making these adjustments to your property can carry a considerable initial price tag, the long-term savings will be worth it.
A few ideas for improvements include energy efficient light bulbs, sealing or resealing drafty areas in the property such as along baseboards, and adding insulation to attics and basements. In general, periodically looking at your property to see if plumbing, plastering, or electrical elements need replacing is a good practice. This way you can budget and execute improvements to suit your business plan. By being proactive instead of waiting for an emergency you could also save yourself a lot of money.
Love at First Sight: Landscaping Value into Your Property
Another way to show your property some love is to improve its value with aesthetic enhancements. Simple landscaping jobs can add mega return on investment. The outer beauty of a property is the first thing buyers notice, and a good first impression has been known to add up to 20% to a property’s value. Desirable landscape elements include complementary front yard plantings, front walkways, outside lighting, patios, decks, and enclosed terrace extensions.
It’s best to get a professional landscaper to handle these jobs as they can quickly and easily determine what elements need to be removed or added to your property to instantly increase its value while keeping to your budget. Plus they will be able to point out helpful things like which half dead trees are beyond saving and which plants will eventually cause problems.
With these tips and tricks, you have a multitude of methods for making sure your property investments feel loved and remain kind to your pocket!
Have you been considering an investment property in Florida? Contact MSR Holdings today about profitable and fully managed residential and commercial real estate investments?